Weekly Update for Government Contractors and Commercial Businesses– June 30, 2022

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GOVERNMENT CONTRACTS

House Passes Bill Increasing Importance of Subcontracting Plan Performance as an Evaluation Factor, Sam Finnerty, 06.22.22
On June 8, 2022, the U.S. House of Representatives passed a bill, referred to as H.R. 7694, “Strengthening Subcontracting for Small Businesses Act of 2022” (the Bill). The Bill seeks to amend the Small Business Act by requiring federal agencies to more broadly consider the content of subcontracting plans and subcontracting plan performance when evaluating large businesses for federal contracts. If enacted, the Bill should encourage large businesses to subcontract more work to small businesses and to achieve their small business subcontracting goals. Read more here.

SBA Extends Bona Fide Place of Business Moratorium, Meghan Leemon, 06.21.22
Last August, PilieroMazza reported that Bibi Hidalgo, the Associate Administrator for SBA’s Office of Government Contracting and Business Development, announced that SBA will be suspending the bona fide place of business requirement for 8(a) construction contracts, effective immediately. While the Small Business Act requires that, to the “maximum extent practicable, construction subcontracts awarded by the Administration pursuant to this subsection shall be awarded within the county or state where the work is to be performed,” in light of the COVID-19 pandemic, it was not practicable to implement this requirement. Accordingly, SBA suspended this requirement to allow more small, disadvantaged businesses to be eligible for and be awarded 8(a) construction contracts. This suspension was set to remain in place through September 2022. John Klein, SBA’s Associate General Counsel for Procurement Law, recently announced at the National 8(a) Association Alaska Regional Conference that Ms. Hidalgo made the decision that it continues to not be practicable to implement this requirement. Accordingly, the moratorium will be extended through at least September 2023. Presumably, this moratorium will continue to apply to contracts offered to the 8(a) program from August 25, 2021 – September 30, 2023. Read more here.

5 Key Ways a Contractor Can Be Subject to a Government Claim, Peter Ford and Patrick Rothwell, 06.20.22
The performance of any government contract by a contractor has the potential to bring certain monetary risks of a government claim against the contractor. This post covers 5 key ways a government contractor can be subject to a government claim and best practices to reduce your risks. Read more here.

GSA Awards Final Cohort on 8(a) STARS III
The U.S. General Services Administration recently awarded the third and final cohort of the 8(a) STARS III Governmentwide Acquisition Contract. The program aims to provide additional opportunities to small businesses in coordination with the U.S. Small Business Administration. 8(a) STARS III continues to support the President’s Executive Order 13985 On Advancing Racial Equity and Support for Underserved Communities Through the Federal Government to improve diversity, equity, inclusion, and accessibility. 

DFARS: Reporting Tax Information on Certain Foreign Procurements
The Department of Defense (DOD) is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to allow for the efficient and accurate identification of contracts subject to excise tax withholding. DOD is also proposing to prohibit use of the Governmentwide commercial purchase card as a method of payment when the tax on certain foreign procurements applies. Comments on the proposed rule are due August 22, 2022, for consideration in the formation of a final rule. Read more here.

Small Business Leaders Urge Congress to Address Category Management Woes
Small business owners and experts implore Congress to take action against the rapidly declining rate of small businesses within the federal marketplace, testifying that the increased use of category management policies and practices has shut out competition and reduced overall innovation in government. Read more here.

The Pentagon Should Keep Better Tabs on IT Cybersecurity, Supply Chain Risks, GAO Says
The Defense Department (DOD) should keep better track of its cybersecurity and supply chain risk management plans, according to a recent watchdog report. The Government Accountability Office (GAO) found that of the 25 DOD major IT programs it reviewed, only 15 of those programs had department-approved cybersecurity strategy and just 10 had, and submitted, a system security plan for information and communications technology supply chain risk management. The GAO also found that most of DOD’s major IT business programs experienced cost or schedule changes between fiscal years 2020 and 2022, ranging from $100,000 to nearly $11 billion. Read more here.

New Technology Modernization Fund Investments to Boost Network Security for Critical Services
The Technology Modernization Fund announced investments to modernize networks in the Department of Agriculture and Department of Homeland Security, while also helping the Federal Trade Commission implement zero trust architecture to boost cybersecurity. Read more here.

Upcoming Government Contracts Presentations

EVENT: Cyber Preparedness and Its Impacts on Your Bottom Line, July 13, Dave Shafer. Read more here.

EVENT: Mentor Protégé Programs, July 14, Tony Franco. Read more here.

WEBINAR: FCA Implications for M&A Transactions, July 26, Cy Alba and Matt Feinberg. Read more here.

WEBINAR: Joint Ventures – A Roadmap for Small Business Government Contractors, July 26. Read more here.

WEBINAR: Small Government Contractors and the FCA: Is More Enforcement on the Horizon? August 31, Jackie Unger and Matt Feinberg. Read more here.

WEBINAR: Protecting Your Confidential Information: FOIA Exemption 4 for Government Contractors, September 15, Kevin Barnett. Read more here.

LITIGATION & DISPUTE RESOLUTION

PilieroMazza’s Litigation Group Welcomes Lucian Grove to Its Expanding Team, 06.21.22
PilieroMazza is pleased to announce the addition of Lucian Grove to the Firm’s expanding Litigation & Dispute Resolution Group. Matt Feinberg, Chair of the Group, said: “Lucian brings to the team a wealth of knowledge and experience advocating for the rights of clients. We are delighted to welcome him to our expanding team and look forward to his contributions.” Lucian is also a member of the Firm’s False Claims Act and Audits & Investigations practice groups. Read more here.

Military Contractors Indicted for $7 Million Procurement Fraud Scheme
A federal grand jury returned an indictment charging military contractors with an alleged fraud scheme involving government contracts totaling over $7 million. The indictment charges Envistacom LLC; its President, Alan Carson; and a vice president, Valerie Hayes, each with one count of conspiracy to defraud the U.S. and two counts of major fraud. Read more here.

Upcoming Litigation & Dispute Resolution Presentations

WEBINAR: FCA Implications for M&A Transactions, July 26, Cy Alba and Matt Feinberg. Read more here.

WEBINAR: Small Government Contractors and the FCA: Is More Enforcement on the Horizon? August 31, Jackie Unger and Matt Feinberg. Read more here.

LABOR & EMPLOYMENT

DFARS: Prohibition on Award to Contractors That Require Certain Nondisclosure Agreements
The Department of Defense (DOD) is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to prohibit the award of any DOD contracts to an entity that requires its employees to sign internal confidentiality agreements or statements that would prohibit or otherwise restrict employees from lawfully reporting waste, fraud, or abuse related to the performance of a DOD contract to a designated investigative or law enforcement representative of DOD authorized to receive such information. Comments on the proposed rule are due August 22, 2022, for consideration in the formation of the final rule. Read more here.

Upcoming Labor & Employment Presentations

WEBINAR: FAR Parts 22 & 23, July 6, Nichole Atallah. Read more here.

WEBINAR: Non-Displacement, July 13, Nichole Atallah. Read more here.